Himes: Congress to avoid fiscal cliff

Martin B. Cassidy

Updated 10:21 pm, Tuesday, November 20, 2012

STAMFORD -- U.S. Rep. Jim Himes, D-Conn., expressed hope the lame-duck Congress and President Barack Obama can expedite a compromise package of new taxes and spending cuts to avoid the so-called "fiscal cliff" of expired tax and spending cuts set to hit later this year.

Himes said his optimism was bolstered by a post-election meetings between House Speaker John Boehner, of Ohio, other Republican leaders and President Obama last week that reflected a softer GOP line toward raising new tax revenue to reduce the national deficit.

"We saw a very conciliatory tone from the Congressional leaders, who very explicitly put tax revenue increases on the table which was new for (Boehner) and the rest of the leadership was equally conciliatory in the language of what they want to achieve in the next weeks," Himes said.

Even without a final vote by the Dec. 31 deadline, Himes said he hoped the outgoing Congress can agree on spending limits and tax increases to justify a reprieve from the automatic tax and spending cuts to allow the new Congress to flesh out the deal.

"Some element of deadline moving is probably called for," he said.

If not averted, the fiscal cliff -- a $600 billion combination of expired tax cuts and automatic spending cuts set to take effect Jan. 1 -- is to further erode confidence in the U.S. economy and set off potential layoffs in the defense and other industries.

While the conceptual agreement is likely to set ground rules for reforming the tax code and finding a palatable way to reduce the costs of Medicare, Social Security, and Medicaid, more specific blueprints to change those systems will require more time, Himes said.

He said the pact including plans to cap overall spending on government health care going forward, to be followed by specific proposals to trim Medicare costs.

"How do you reform Medicare in an equitable, fair, and smart way is a huge and difficult conversation," Himes said. "The idea would be to agree to cap the costs of government healthcare and over time design a healthcare delivery system that isn't about doing a lot of stuff but about doing the good stuff."

Himes said despite recent bloodshed due to conflicts between Israel and Hamas militants in the Gaza strip, any deliberations on how to handle the Middle East crises over the next month will need to be concurrent with reaching a compromise on the fiscal cliff.

U.S. lawmakers have asked Egypt and Turkey to use their influence to sway Hamas militants to seek a ceasefire with Israel.